President Donald Trump has argued that revenue from tariffs
could replace, at least in large part, the current federal income tax system
and has championed the American economic model prior to 1913.
WASHINGTON—Donald Trump has once again brought up one of his
most controversial economic proposals: using revenue from tariffs to
substantially reduce—and eventually replace—the federal income tax for
Americans.
The president has argued that the United States was
extraordinarily prosperous during the period before the implementation of the
federal income tax in 1913 and has used that historical era as a reference
point to defend a model based on revenue from international trade.
“1913” features prominently in Trump’s argument. In public
statements, the president has recalled that before that year, the United States
was financed primarily through tariffs and did not have the current federal income
tax system.
During his 2026 State of the Union address, Trump asserted
that tariffs could “substantially” replace the modern income tax system,
reducing what he described as a significant financial burden for Americans.
The idea has been met with enthusiasm by both supporters and
detractors, some of whom consider it a genuine attack on the current tax system
and the Internal Revenue Service (IRS).
Although the IRS has not been eliminated—the agency
continues to operate, and the federal income tax remains in effect—replacing it
with a tax reform of this magnitude would require legislative action from
Congress. This is expected to occur in the near future.